Taro rejects $368M offer from Indian pharma BY JANICE KIRKEL jkirkel@westfairinc.com
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aro Pharmaceutical Industries, an Israeli drug company whose U.S. headquarters is in Hawthorne, has rejected a $368 million unsolicited offer from Sun Pharmaceutical Industries of India for the one-third of Taro that it does not already own. Sun’s bid was 26 percent above Taro’s $19.45 share price the day before the bid was revealed Oct. 18, but that was considered too low by several of Taro’s minority shareholders. Taro stock topped $24.50 Nov. 2 and so far in 2012 has traded at a minimum of $30.
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Taro and Sun have been battling for a number of years. Sun’s purchase of most of Taro was held up for several years as Taro’s founders contested the price Sun was paying for their stock. In May 2007, the companies entered into a merger agreement at $7.75 a share and then raised that to $10.25 before Taro rejected the offer. A ruling by the Israeli supreme court in September 2010 gave Sun voting control of Taro. The $24.50 a share bid valued Taro at nearly $1.1 billion. Taro produces more than 200 prescrip-
tion and over-the-counter products in plants in the U.S., Canada and Israel. It specializes in dermatological creams, ointments and gels that can be very profitable, analysts say, because treatments for skin disorders require sophisticated production. That makes it hard for new companies to enter the field, so there are just a few competitors for each drug and profit margins are high. Sun’s biggest market is the U.S. where Caraco Pharmaceutical Labs, a subsidiary, gives it a generic presence. Caraco is another drug company in the U.S. that Sun partially bought and managed. It was finally
bought outright by Sun after resolving a manufacturing problem. Taro’s earnings have improved since Sun took control. It has a reputation for containing costs. In India, Sun is strongest in drugs for heart disease, as well as neurological and psychiatric disorders. Sun has bought 13 drug companies in the past 15 years and has yearly revenues of $1.7 billion. Taro accounts for a third of its sales and earnings. Israel Makov took over as Sun’s chairman in May. He previously led the expansion of Teva Pharmaceuticals, another Israeli drug company, through both acquisitions and generic drug approvals.
Pattern gets new VP
ylvia Murphy has joined Hudson Valley Pattern for Progress as vice president for development. The Newburgh-based Pattern for Progress is a not-for-profit policy and planning agency that promotes regional, balanced and sustainable solutions to enhance the growth and vitality of the Hudson Valley. Murphy, who previously worked for HealthAlliance of the Hudson Valley as its director of marketing, has more than 10 years’ experience in the marketing industry as well as more than 20 years in management. Jonathan Drapkin, Pattern president and CEO, said in a statement, “After an exhaustive search, we are very excited to add Sylvia to Pattern’s growing staff. Her interpersonal skills, her knowledge of marketing and public relations and her many years of living in the Hudson Valley make her a perfect fit for this position.” Hudson Valley Pattern for Progress was founded in 1965 by business, academic and civic leaders. Its work encompasses a ninecounty area, including Columbia, Dutchess, Greene, Orange, Putnam, Rockland, Sullivan, Ulster and Westchester.
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HV Biz • WCBJ • July 30, 2012
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